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BASF is mulling over a bid for moisturizer-ingredients producer Cognis, as the German chemical major sees signs of improvement in the luxury cosmetics market along with chemical market for personal-care products. "During [the] last year, some premium products have been lower in demand, but there are signs that it's recovering, that we are seeing growth in both sectors," said Thomas Greindl, the European marketing director at BASF's care-chemicals unit. However, even if Cognis "fits very well" with BASF's plans, it may not be too quick to sell, analysts said.

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BASF and specialty-chemicals maker Cognis are reportedly close to a deal where BASF will pay about $3.7 billion for the assets of the former Henkel unit. Goldman Sachs and Permira, the owners of Cognis, have apparently made ground in resolving differences with BASF regarding potential risks in the acquisition. "The deal could be completed by the end of the coming week," a source close to the negotiations said.

BASF is mulling over a bid for moisturizer-ingredients producer Cognis, as the German chemical major sees signs of improvement in the luxury cosmetics market along with chemical market for personal-care products. "During [the] last year, some premium products have been lower in demand, but there are signs that it's recovering, that we are seeing growth in both sectors," said Thomas Greindl, the European marketing director at BASF's care-chemicals unit. However, even if Cognis "fits very well" with BASF's plans, it may not be too quick to sell, analysts said.

Lubrizol, a U.S.-based specialty-chemicals company, joined BASF and other bidders to acquire Cognis, a German company that manufactures additives for cosmetics and detergents, according to a Financial Times report. Lubrizol offered about $4.1 billion, the report said.

Chemical major BASF is seeking to buy chemical maker Cognis for about $4 billion and may submit an offer next week, sources said. "Cognis is strong in home and personal-care chemicals based on natural raw materials. Whoever owns Cognis, owns the global market leader," a UniCredit analyst said. Other potential bidders for Cognis include U.S. companies Lubrizol and DuPont.

An official with chemical giant BASF said the company would rather reduce production of its personal-care chemicals than give in to pressure from detergent and shampoo manufacturers to reduce prices to levels it says are not economical. Prices for personal-care chemicals have decreased this year, but remain higher than in other sectors because of sustained demand for products such as shampoo, diapers and detergent, said Gabriel Tanbourgi, head of the care-chemicals unit at BASF.